Sunday, July 04, 2010

Canadian Custer

On the day after the leaders of the G20 nations left Toronto -- and left city workers to clean up after the weekend's mayhem -- John Ibbitson wrote that the summit was "a signal achievement for the Prime Minister, who set those targets and lobbied hard for other nations to embrace them."

On the same day, Paul Krugman looked at the targets and concluded: "We are now, I fear, in the early stages of a Third Depression.

And this third depression will be primarily a failure of policy. Around the world -- most recently at last weekend's deeply discouraging G20 meeting -- governments are obsessing about inflation when the real threat is deflation, preaching the need for belt tightening when the real problem is inadequate spending.

Mr. Ibbitson saw Canada leading the way, showing the rest of the world how to tighten its belt:

Now Mr. Harper has succeeded in convincing his peers that the time is right for other governments to follow Canada in shifting to deficit cutting. And once again he has an internationally certified mandate to chop government programs and search for additional revenue.

It bears repeating that Mr. Harper didn't see the Great Recession coming. He refused to read the signs. The problem now, wrote Krugman in Friday's New York Times, is that

This conventional wisdom isn't based on either evidence or careful analysis. Instead, it rests on what we might charitably call sheer speculation, and less charitably call figments of the policy elite's imagination -- specifically on what I've come to think of as the invisible bond vigilante and the confidence fairy.

Krugman then went on to define "bond vigilantes" as "investors who pull the plug on governments they perceive as unable or unwilling to pay their debts." These vultures believe that all countries -- particularly the United States -- are like Greece -- and that "(a) the bond vigilantes are about to attack America and (b) spending anything more on stimulus will set them off."

But, wrote Krugman, "what we do on stimulus over the next couple of years has almost no bearing on our ability to deal with these long range problems." If inflation is indeed a tsunami which is about to sink the world's economies, there should be some upward movement in interest rates. But, after a slight uptick three months ago, interest rates have once again headed for the basement. The facts simply don't support the fears.

Mr. Harper is a very shrewd political animal. But, when it comes to factual analysis, he is not the sharpest tool in the shed. He is planning to build a series of new prisons in anticipation of a crime wave, even though crime (according to Statistics Canada) has declined year after year. The rate of violent crime has remained stable for ten years. His government offers unconditional support for Israel, ignoring the fact that the continued construction of settlements on occupied land and the blockade of Gaza contributes to the misery there.

The truth is that Mr. Harper's certitude is based on faith not fact. And he continues to believe that because he earned a Master's degree at the University of Calgary he is an economist. George Armstrong Custer graduated from West Point; but that did not make him a general. Mr. Ibbitson believes that the Prime Minister deserves kudos for leading the charge against world deficits. Historians may well look at the Toronto Summit and conclude that it was Mr. Harper's Little Big Horn.

This blog entry is cross posted at The Moderate Voice.


DrowseyMonkey said...

Well said. I've missed reading your blog. He seems to think Canadians are very violent, new prisons, huge walls in Toronto for the summit. I was in Toronto for that weekend and there were thousands more peaceful people. Only a few thugs.

Owen Gray said...

You would know far better than those of us who live in the Hinterland, Drowsey.

There is something deeply disturbing about this government's ability to deal with dissent. They distrust those who don't think as they do.

thwap said...

Ibbitson is a revolting, boot-licking hack.

Owen Gray said...

I think Ibbitson's analysis is completely wrong headed. But he has a lot of company.

Nonetheless, your comment is truly unfair. His column simply proves that wisdom cannot be verified by the number of followers it attracts.

Remember when the world was going to fall apart as we entered the year 2000?

thwap said...

I've read his hackery on the subject of torture. I think Ibbitson really is a loathsome excuse for a human being.

The Mound of Sound said...

Owen, the world did fall apart in 2000 only it didn't come from an operating system malfunction but an electoral dysfunction south of the border. The place hasn't been the same since.

As for Ibbitson, he's simply unfortunate.

And when it comes to the Harper autocracy and dissent, those he cannot tightly control he gags. Simply look at how he's severed all lines of direct communication between the armed forces and the public service and the Canadian people either directly or through their media.

Owen Gray said...

I understand your fury at Ibbitson's defense of this government's policy toward Afghan detainees, Twap. Even the very bright are capable of extraordinary self-delusion.

And, as "Mound" says, the world changed with the election of George W. -- a collective act of extraordinary self delusion.

What is sad is that this prime minister is equally committed to electoral dysfunction in this country.